For instance, the contributor can not direct, overfund
, or use the investment in the plan as security for a loan.
During the January 15, 1997, hearing on the proposed regulations, government representatives expressed concern that some foreign jurisdictions may permit taxpayers to overfund
their plans, thereby enabling taxpayers to shield income-generating assets from the reach of U.
The ability to save through a pension plan at before-tax rates of return provides incentives for owners of corporations to overfund
pension plans and later to withdraw the excess assets, either through reversions or through lower future contributions.